Calif. Divestment Bill Is Defeated

The Recording Industry Assn. of America (RIAA) is applauding the failure of a bill designed to force California's retirement pension system to divest itself of stock in entertainment companies that produce music that allegedly promotes crime, domestic violence, drug use, degradation of women, or racism.
The California Public Employees Retirement System has millions of dollars invested in such entertainment companies as Warner Bros. and Disney.
Says RIAA president/CEO Hilary Rosen, "This is a very important state to have a victory in, since it has such a large pension fund and such a large presence in the music community."
The bill, called the California Protection Act, was sponsored by California state Assemblyman Keith Olberg, R-Victorville, and voted down April 22.
"This bill does not address the First Amendment," Olberg says. "It doesn't restrict free speech in any way . . . Under this bill, we simply [would not] invest in music that encourages violence in the streets."
The bill's failure, Olberg says, suggests that "people have decided that profits are more important than public safety."
Olberg's was the latest in a series of "investment divestment" bills across the country that would either force or recommend that state pension systems divest their interests in entertainment companies that release music with allegedly offensive lyrics. Pending bills in Wisconsin and Tennessee are expected to be debated in the coming weeks.
"These lyric bills are kind of like viruses," says Rosen. "They come and go, but you have to nurse every one of them."
Last year, the RIAA was successful in defeating similar divestiture legislation in Pennsylvania and Maryland.
The RIAA has also had to lobby against several state censorship bills and legislation seeking local community obscenity standards (Billboard, Feb. 21).
On April 16, a Texas court ruled that a divestment rider attached to the state appropriations bill was unconstitutional.
Travis County Court in Austin, Texas, agreed with the position taken by the RIAA that the bill was unconstitutional because it was too broad.
Also, the rider was attached to the appropriations bill, even though it had originally been defeated in the state House of Representatives, thus violating the principle of the Texas constitution's "one subject" provisions. As a result, Judge F. Scott McCown threw out the rider, even though the appropriations bill had already been signed into law by Gov. George Bush. McCown enjoined state officials from enforcing the rider and ruled it "properly severed" from the main bill.
In another legislation-related matter, the RIAA was successful in lobbying to have amended another pending California bill that would have required record retailers to segregate "harmful matter" in bins labeled "adults only." As amended, the bill now exempts materials containing a parental advisory label.